This chapter reviews a program of research concerned with better understanding how decision making behavior is contingent upon properties of the decision task.
Author: John W. Payne
Research has shown that the strategies people use to evaluate and choose among a set of multiattribute alternatives are highly sensitive to a variety of task and context variables. This chapter reviews a program of research concerned with better understanding how decision making behavior is contingent upon properties of the decision task. The perspective adopted is that strategy selection is a function of both costs, primarily the effort required to use a decision Rule, and benefits, primarily the ability of a strategy to select the best alternative. A series of experiments involving both Monte-Carlo simulation and process-tracing techniques is reported that support the effort-accuracy framework. Unresolved issues of learning, bottom-up as well as top-down processing, and the role of incentives in strategy selection are then discussed. Finally, an implication of adaptive decision behavior for improving decisions by designing information displays which make effective processing easier is outlined. (KR).
6 The Adaptive Decision Maker : Effort and Accuracy in Choice JOHN W. PAYNE , JAMES R. BETTMAN , and ERIC J. JOHNSON Research has shown that the strategies people use to evaluate and choose among a set of multiattribute alternatives are ...
Author: Robin Hogarth
Publisher: University of Chicago Press
Category: Business & Economics
How do people make decisions? How can we help people make better decisions? How can we best study the processes of decision making? The growing field of behavioral decision research, which seeks to link observed decision behavior to underlying psychological mechanisms, may provide the answers to these questions. The volume is based on a recent conference held to honor the work and memory of the late Hillel J. Einhorn, a pioneering scholar in behavioral decision research. Composed of contributions by leading researchers, Insights in Decision Making provides a state-of-the-art image of work in this field. The range of topics covered includes conceptual and technical issues the bridge the gap between theory and the practical concern of improving decision making, difficulties in statistical thinking, experimental studies of processes of judgment and choice, and the emergence of new paradigms for studying decision behavior. Providing many avenues for future research, Insights in Decision Making will be essential reading for students of the psychology of decision making and will prove valuable to readers in psychology, economics, statistics, and management.
Adaptive strategy selection in decision making . Journal of Experimental Psychology : Learning Memory and Cognition , 14 , 534-552 . Payne , J. W. , Bettman , J. R. . & Johnson , E. J. ( 1990 ) . The adaptive decision maker : Effort and ...
Author: Ola Svenson
Publisher: Springer Science & Business Media
The current volume makes an important contribution to an underexplored field by integrating research into the effects of stress associated with time constraints on individual judgment. Unique and comprehensive, the book reviews knowledge from a variety of disciplines; critically examines the theories, methodologies, and data of time-pressure research; and suggests priorities for future research.
The Adaptive Toolbox Gerd Gigerenzer, Reinhard Selten. complex and dynamic decision problem is not a primary perceptual datum . Instead , “ it is an inference based on a normative model of the task , and , if the decision maker does not ...
Author: Gerd Gigerenzer
Publisher: MIT Press
Category: Business & Economics
In a complex and uncertain world, humans and animals make decisions under the constraints of limited knowledge, resources, and time. Yet models of rational decision making in economics, cognitive science, biology, and other fields largely ignore these real constraints and instead assume agents with perfect information and unlimited time. About forty years ago, Herbert Simon challenged this view with his notion of "bounded rationality." Today, bounded rationality has become a fashionable term used for disparate views of reasoning. This book promotes bounded rationality as the key to understanding how real people make decisions. Using the concept of an "adaptive toolbox," a repertoire of fast and frugal rules for decision making under uncertainty, it attempts to impose more order and coherence on the idea of bounded rationality. The contributors view bounded rationality neither as optimization under constraints nor as the study of people's reasoning fallacies. The strategies in the adaptive toolbox dispense with optimization and, for the most part, with calculations of probabilities and utilities. The book extends the concept of bounded rationality from cognitive tools to emotions; it analyzes social norms, imitation, and other cultural tools as rational strategies; and it shows how smart heuristics can exploit the structure of environments.
The standard advice works well when everything is clear, but the tough decisions involve shadowy conditions of complexity and ambiguity.
Author: Gary A. Klein
Publisher: MIT Press
An expert explains how the conventional wisdom about decision making can get us into trouble—and why experience can't be replaced by rules, procedures, or analytical methods. In making decisions, when should we go with our gut and when should we try to analyze every option? When should we use our intuition and when should we rely on logic and statistics? Most of us would probably agree that for important decisions, we should follow certain guidelines—gather as much information as possible, compare the options, pin down the goals before getting started. But in practice we make some of our best decisions by adapting to circumstances rather than blindly following procedures. In Streetlights and Shadows, Gary Klein debunks the conventional wisdom about how to make decisions. He takes ten commonly accepted claims about decision making and shows that they are better suited for the laboratory than for life. The standard advice works well when everything is clear, but the tough decisions involve shadowy conditions of complexity and ambiguity. Gathering masses of information, for example, works if the information is accurate and complete—but that doesn't often happen in the real world. (Think about the careful risk calculations that led to the downfall of the Wall Street investment houses.) Klein offers more realistic ideas about how to make decisions in real-life settings. He provides many examples—ranging from airline pilots and weather forecasters to sports announcers and Captain Jack Aubrey in Patrick O'Brian's Master and Commander novels—to make his point. All these decision makers saw things that others didn't. They used their expertise to pick up cues and to discern patterns and trends. We can make better decisions, Klein tells us, if we are prepared for complexity and ambiguity and if we will stop expecting the data to tell us everything.
3 and 4 decide for M1, whereas they chose M2 and M4 if they were active-adaptive decision-makers. After a decade of climate observations, the initial beliefs were updated for both active-adaptive and determinist decision-makers.
Author: Seppo Kellomäki
Publisher: Springer Science & Business Media
For thousands of years, forest biomass or wood has been among the main energy sources of humans around the world. Since the industrial revolution, fossil fuels have replaced wood and become the dominant source of energy. The use of fossil fuels has the disadvantage of increasing atmospheric concentrations of greenhouse gases (GHGs), especially carbon dioxide (CO2), with the consequent warming of global climate and changes in precipitation. In this context, the substitution of fossil fuels with renewable energy sources like forest biomass is among the ways to mitigate climate change. This book summarizes recent experiences on how to manage forest land to produce woody biomass for energy use and what are the potentials to mitigate climate change by substituting fossil fuels in energy production. In this context, the book addresses how management can affect the supply of energy biomass using short-rotation forestry and the conventional forestry applying long rotations. Furthermore, the book outlines the close interaction between the ecological systems and industrial systems, which controls the carbon cycle between the atmosphere and biosphere. In this context, sustainable forest management is a key to understand and control indirect carbon emissions due to the utilization of forest biomass (e.g. from management, harvesting and logistics, and ecosystem processes), which are often omitted in assessing the carbon neutrality of energy systems based on forest biomass. The focus in this book is on forests and forestry in the boreal and temperate zones, particularly in Northern Europe, where the woody biomass is widely used in the energy industry for producing energy.
It is a fundamental characteristic of an adaptive process that the performance of an adaptive decision maker may deviate from the performance expected from the same decision maker, but having full information about the probability ...
Author: Roy E. Murphy
Category: Technology & Engineering
Mathematics in Science and Engineering, Volume 20, Adaptive Processes in Economic Systems demonstrates the usefulness of communications theory, self-adaptive control theory, and thermodynamic theory to certain economic processes. This book discusses the common properties of adaptive processes, role of the decision maker, and mixed adaptive processes of the first and second kind. The economic environmental processes, concept of entropy time, and stochastic dynamic economic process are also elaborated. This text likewise covers the investment model with full liquidity, adaptive capital allocation process, and concept of an economic state space. Other topics include the stochastic equilibrium in the market and individual adaptive behavior. This volume is suitable for engineers, economists, and specialists of disciplines related to economic systems.